Staid Yuan Roams as China Lets Out Slack

By

Lingling Wei

Updated Oct. 25, 2012 10:11 p.m. ET

BEIJING—The once-predictable Chinese yuan has become increasingly volatile, a development that signals a stronger role for markets in the currency's moves but poses greater foreign-exchange risks for businesses and investors.

China still keeps a tight grip on the yuan by limiting its trading within a range. In terms of volatility, the currency still pales in comparison to more freely traded counterparts.